Tag Archives: US stock indices

US Stock Indices Hit Record Highs, Powered by Technology Giants

US Stock Indices Hit Record Highs, Powered by Technology Giants:
The S&P 500 Index achieved its 54th all-time high this year,
driven by strong performance from major technology companies.
Meanwhile, Federal Reserve Governor Christopher Waller said he leans toward
voting for an interest rate cut in December, bolstering positive market sentiment.

 

Contents

Technology Stocks

Market and Index Performance

Room for Further Growth

Key Economic Data

Strong December Performance

Risks on the Horizon

Potential Volatility

Conclusion

 

 

 

 

Technology Stocks Propel US Indices to Record Highs

The significant rise in major technology stocks drove US indices to achieve new record highs.
This comes as Wall Street traders prepare for a series of economic data releases and Federal Reserve statements,
which are expected to play a critical role in shaping the future path of interest rates.

 

Market and Index Performance

The S&P 500 rose by 0.2%, while the Nasdaq 100 jumped by 1.1%.
In contrast, the Dow Jones Industrial Average fell by 0.3%.
Tesla led gains in the technology sector, while Apple shares hit new record highs.
 Treasury yields for 10-year bonds increased by two basis points to reach 4.19%.
Additionally, the dollar broke a three-day losing streak following comments from President-elect Donald Trump,
who warned BRICS nations against attempts to replace the dollar.

 

Room for Further Growth

Despite the most substantial rally the S&P 500 has experienced since the dot-com boom,
the index still has room for further growth, according to Andrew Tyler of JPMorgan Chase.
Tyler noted that the most common options trades suggest the index could reach 6,200 and 6,300 this month,
with the index closing Monday slightly below 6,050.

 

Key Economic Data This Week

The jobs report due Friday is the week’s highlight.
The November employment report is expected to show a rebound
after hurricanes and strikes affected job growth in the previous month.
Additionally, Federal Reserve Chair Jerome Powell will participate in a discussion on Wednesday,
during which investors will watch for his assessment of the labor market
and inflation and hints about the December interest rate decision.
 Tom Essaye of “The Sevens Report” described this week as “the last critical week for economic data in 2024.
” He added, “If the data is positive, investors could anticipate
a soft economic landing and an interest rate cut in December,”
which may support significant gains before the year’s end.

 

 

 

 

 

Strong December Performance with Caution of a Pullback

According to Sam Stovall of CFRA, December boasts the
second-highest average monthly return for the S&P 500 since World War II,
with a high advance rate and low standard deviation of returns, especially during election years.
 However, Craig Johnson of Piper Sandler cautioned that the
stock market’s constructive trends rely on continued expansion in small-cap stocks, which could lift all sectors.

 

Risks on the Horizon for 2025

Despite the positive momentum, concerns loom that 2025 could present more significant challenges.
Ed Clissold of Ned Davis Research noted that markets recording 50 or more
all-time highs in a single year tend to decline the following year, with an average loss of 6.2%.

 

Potential Volatility and Investment Strategies

Matt Maley of Miller Tabak remarked, “Despite concerns about markets reaching peak levels,
most investors don’t see this as a real threat until next year.”
However, he warned that such complacency could lead to sudden pullbacks,
though clear signs of a downturn have yet to emerge.

 

Conclusion

While current forecasts remain optimistic,
the new year will require balanced investment strategies and realistic risk assessments,
especially given the possibility of market corrections during the first half of 2025.

 

US Stock Indices Hit Record Highs, Powered by Technology Giants

US Stock Indices Close November with Exceptional Performance

US Stock Indices Close November with Exceptional Performance: November ended with remarkable performance in US financial markets,
as the “S&P 500” recorded its strongest monthly gain this year.

This was accompanied by shifts in bond yields and the dollar,
driven by speculation about potential policy changes post-elections.

This report explores the impact of US economic policies and the global markets’ response,
including Europe, Canada, and Japan.

 

 

Content

Notable US Performance

Most robust Monthly

Global Performance of Stocks and Currencies

November Performance Summary

 

 

Notable US Performance

US stock indices ended the short trading session on Friday higher,
while Treasury yields fell across all maturities.
This was attributed to expectations that President-elect
Donald Trump might adopt less stringent trade policies,
leading to the dollar’s most significant weekly loss in three months.

The “S&P 500” index rose by more than 1%
for the second consecutive week and climbed 0.6% on Friday to reach new record levels.
Meanwhile, the 10-year Treasury yield declined to 4.17%,
and the Bloomberg Dollar Spot Index continued its
weekly decline by over 1% after an eight-week winning streak.

Trump’s selection of a Treasury Secretary nominee
boosted optimism that tariffs would be more measured.
This would support the performance of US stocks and bonds while weakening the dollar.

 

Most robust Monthly Performance for “S&P 500”

The S&P 500 rose 5.7% in November,
marking its best monthly performance of the year.
According to EPFR Global data,
investors poured approximately $141 billion into
US stocks during the month had the largest four-week inflow on record.

This performance was driven by a small group
of major technology stocks amid expectations of the
Federal Reserve lowering interest rates while the US economy grows.

Max Kettner, Chief Multi-Asset Strategist at “HSBC Holdings,”
stated in an interview with Bloomberg Television:
 “What matters now is that the Federal Reserve is shifting its policy,
leading to lower real interest rates and higher stocks. The current conditions are ideal.”

 

 

 

Global Performance of Stocks and Currencies

Canada and Europe:

  • In Canada, the economy recorded modest growth last month,
    increasing the likelihood of the central bank continuing to cut interest rates.
  • In Europe, fiscal spending appears to be improving,
    with expectations that any potential ceasefire
    in Ukraine could ease the pressure from rising energy prices.

Eurozone:
 Inflation rose above the European Central Bank’s 2% target,
but only slightly, which is unlikely to alter the course of monetary policy.

Japan:
 The yen briefly dropped below the 150 level against
the dollar after the Bank of Japan Governor
Kazuo Ueda stated that further currency weakening poses significant risks.
Earlier, the yen had rebounded above this level following
Tokyo inflation data showing higher-than-expected price increases,
raising bets on a potential interest rate hike at the Bank of Japan’s upcoming meeting.

 

November Performance Summary

The performance of US markets in November highlights the
relative strength of the US economy compared to the rest of the world,
supported by expectations of interest rate cuts
and substantial inflows into stocks.
As global market developments continue,
the future of monetary policies remains a critical factor in shaping market directions.

 

 

US Stock Indices Close November with Exceptional Performance

A decline in US Stock Markets Amid Economic Expectations

A decline in US Stock Markets Amid Economic Expectations: The US stock market indices saw a significant decline
amidst growing speculation that the market exceeded logical limits following the US elections,
diminishing bets on the Federal Reserve’s continued rate cuts.

Content

Loss of Momentum in Stocks
Treasury and Dollar Performance
Analysts’ Market Views
Fed Expectations and Inflation Impact
Divergence in Major Indices
Expert Opinions
Inflation and Economic Policies

Future Market Movements

 

 

 

 

 

Loss of Momentum in Stocks

 Stocks lost momentum in the final hours of trading in New York,
with the S&P 500 index nearing erasure of gains achieved partially due to inflation data that met expectations.
Despite Cisco Systems‘ optimistic outlook for the current period,
its cautious annual forecast did not have much impact on investor response.

 

Treasury and Dollar Performance

 Short-term Treasury bonds outperformed,
with the yield on two-year bonds dropping from its highest level since July.
The probability of a rate cut in the December 18 meeting rose to around 80%.
The dollar remained at a two-year high, while Bitcoin pared its gains after surpassing $93,000 earlier.

 

Analysts’ Market Views

 Brett Kenwell of eToro noted that the markets have risen since the elections,
solidifying a mindset of buying on dips.
He pointed out that potential short-term selling may be limited as fund managers seek to improve performance by year-end.

 

Fed Expectations and Inflation Impact

 Consumer Price Index data emphasized the ongoing uncertainty
among Federal Reserve officials regarding the extent of needed rate cuts,
reflecting the policymaking challenges.

 

 

 

 

Divergence in Major Indices

While the S&P 500 index showed little change,
the Nasdaq 100 fell by 0.2%, and the Dow Jones Industrial Average rose by 0.1%.
Ten-year Treasury yields increased by two basis points to 4.45%.

 

Expert Opinions

Seema Shah of Principal Asset Management believes stronger-than-expected
inflation may lead to steady rates at the next meeting.
Other analysts noted that high inflation continues to influence economic policies,
posing challenges to easing monetary efforts.

 

Inflation and Economic Policies

 Ellen Zentner of Morgan Stanley suggested that markets
are currently pricing in a lower probability of rate cuts than previously expected,
with the possibility of the Fed pausing in January.
Jeffrey Roach noted that persistent inflation components could allow for a December rate cut, with a potential pause in January.

 

Future Market Movements

Citi Group analysts highlighted that the focus has shifted to Nvidia’s upcoming earnings report,
which is seen as a major market event.
This illustrates the contrast between concerns over macroeconomic data and the emphasis on the tech sector.

 

A Decline in US Stock Markets Amid Economic Expectations

US Stock Indices Fail to Continue Rising

US Stock Indices Fail to Continue Rising: US stock indices have recently experienced sharp fluctuations,
failing to maintain upward momentum due to weak demand in a 10-year Treasury bond auction.
This article reviews the main events and changes in the US market during this period, highlighting investor reactions and their effects.

 

Content

Weak Bond Demand

Emotional Control

Stock and Bond Performance

Oversold Territory

Recession Fears

Performance of Key Indices

 

 

 

Weak Bond Demand

US stock indices failed to continue their rise after a weak auction for $42 billion in Treasury bonds
revealed market fragility in the wake of historical volatility.
The S&P 500 Index lost its gains following an increase driven by dovish signals from the Bank of Japan.
Investors shunned the 10-year Treasury bond auction, causing yields to rise significantly above the pre-auction guidance level.
The weaker-than-expected demand indicated that the recent rally might have ended.
Treasury bonds also faced pressure as 17 high-quality issuers rushed to offer $31.8 billion in debt,
the highest US investment-grade issuance this year.

 

Emotional Control

Mark Hackett of Nationwide says recent events were a “perfect lesson” on how emotions drive market movements,
especially when sentiment and positioning are almost universally positive globally.
“Stocks remain vulnerable,” according to Fawad Razaqzada of City Index and Forex.com,
adding, “More evidence of a bottom forming is needed to entice bullish speculators back into the market.
Overall, sentiment remained cautious. Many people were not confident buying stocks during this recent dip,
especially with next week’s upcoming US Consumer Price Index announcement.”

 

Stock and Bond Performance

The S&P 500 Index fell by 0.8% after rising nearly 2% earlier in the session.
Nvidia Corp led the decline in significant company stocks. Super Micro Computer’s stock price dropped due to disappointing earnings.
Airbnb’s stock plummeted amid weak forecasts. Micron Technology resumed its buyback program.

Yields on 10-year Treasury bonds rose six basis points to 3.95%.
The Japanese yen’s value fell by 2%. The Mexican peso led a rally in emerging markets,
easing pressure on currencies hit as investors abandoned yen-funded bets on high-risk assets.

 

 

 

 

 

Oversold Territory

Despite the correction, JPMorgan strategists say there is little evidence
that stocks have entered oversold territory as they did in October 2023, for example.
In a Wednesday note, Nikolaos Panigirtzoglou and colleagues wrote,
“In our global equity allocation calculations and returning to post-2015 levels,
stock prices need to fall an additional 8% from their current levels.”

Previous stock gains were supported by reassurances from Japan following
massive stock price swings in the country last week.
These moves were exacerbated by the belief that the Federal Reserve would cut interest rates more aggressively,
prompting traders to quickly unwind yen-funded carry trades,
including crowded positions in US tech stocks.

 

Recession Fears

Markets were thrown into turmoil due to recent weak US data.
However, according to the Franklin Templeton Institute, it is still too early to suggest the economy is heading towards a contraction.
Stephen Dover wrote that it “makes sense” to take some profits after the significant rise in Treasury bonds.

According to Goldman Sachs strategists, US Treasury yields will likely be too low without
“broad-based evidence of sharp deterioration in either the labor market or market functioning.”
William Marshall and Bill Zhu wrote, “The reason for a meaningful rise from current levels is that one or both of these risks materialize”
and “With more moderate outcomes, we believe average yields are likely to be higher than current levels.”

Lowell Cumbernoll of FHN Financial sees Treasury yields comfortably above their lows on Monday,
indicating a sense of calm after financial markets were thrown off balance earlier this week.
He said, “It’s too early to declare an end to the turmoil,
but Treasury yields could drift lower during August’s thin trading and lack of data for the rest of this week.”

 

Performance of Key Indices

The S&P 500 Index fell 0.8% at 4:04 PM New York time.

The Nasdaq 100 Index declined 1.2%.

The Dow Jones Industrial Average dropped 0.6%.

The Bloomberg Dollar Spot Index rose 0.1%.

Bitcoin fell 3% to $54,848.88.

Ether dropped 5.7% to $2,348.53.

Gold fell 0.2% to $2,386.65 an ounce.

 

US Stock Indices Fail to Continue Rising

 

 

US stock indices Fate Regarding the anticipated labour market data

 US stock indices Fate Regarding the anticipated labour market data: Markets await numerous US labour market data releases during the current week,
representing the second most important factor for the US Federal Reserve after inflation data, which showed a negative reading of about 2.8% last week.

 

Topics

Significance of labour market data

Expert predictions

labour market data

 

Significance of labour market data:

The Significance of labour market data comes from previous statements from Fed members
indicated that the bank is not compelled to early interest rate cuts amidst improved labour market data,
contributing to the US economy’s ability to achieve growth in line with declining inflation,
which is encouraging for the US Federal Reserve’s monetary policy committee.

 

Expert predictions:

Experts expect a decline and negativity in labour market data to be released during trading on Friday, March 8th,
where forecasts suggest unemployment rates to remain unchanged at around 3.7%.
As for employment in the non-farm private sector, a decline to only 190,000 jobs is expected,
while the previous reading was around 320,000 jobs.
There are also negative expectations regarding wages,
with a forecast of a 0.4% decrease compared to the last reading of about 0.6%.
This has led investors to raise expectations
for the start of interest rate cuts during the upcoming May meeting due to the decline in US inflation.

 

 


labour market data

Now, all eyes are on labour market data, as a decline and weakness in the US labour market,
a driving force that could indeed prompt the Federal Reserve to cut US interest rates early this year,
may enhance the gains of US stock indices and maintain their positive momentum.
However, suppose the upcoming labour market data contradicts expectations and shows further positivity.
We might witness the opposite in that case, with major US stock indices correcting.
At that point, there could be a possibility of a decline in investors’ bets regarding the May rate cut,
which may contribute to lowering the expectations of the US bank during its upcoming meeting.

 

 

US stock indices Fate Regarding the anticipated labour market data